Weak global cues, tension, weak rupee causing share market to plummet

Experts suggest holding back on trading, adopt wait and watch policy

VAIBHAV PARWAT

Aurangabad, Jan 27:

The uncertainty in the international level has resulted in plummeting of the share market in the past few days. The market also recorded the biggest crash in the past few months worrying the investors. Investors nearly lost Rs 10 lakh crore in the market. Domestic shares have also slumped to their lowest in their past five days. AurangabadFirst spoke to some of the share market experts as to why the market has crashed suddenly and what can investors do to survive this situation.

Markets are likely to continue their sluggish trend tracking weak global cues ahead of the US federal reserve meeting. Expectations that the US federal reserve will move more quickly to hike interest rates to combat inflation hit the global share market hard. The weakness in the market is due to foreign portfolio investors and foreign institutional investors fishing out money from Indian markets. Investors must adopt a wait and watch policy for the next few days, said the head of global capital ltd, Naresh Gupta, stock broker, Hitech agencies.

The investors should not be worried about the downfall as it is a regular occurrence. Market was continuously climbing for the past month. This caused some panic among investors and they started selling off the shares. There are no effects of the Russia-Ukraine war or upcoming budget on the market. The nifty will rise by 600 to 1000 points on Friday and investors must buy shares and hold it for a week. The market is expected to recover after a week, hence they can sell it later, said Akshay Goyal, sub-broker, Edelweiss Broking Ltd.

The threat arising from the rapid pulling out of the foreign Institutional investors and weaker rupee is the biggest factor behind the stock market crash. Stock markets in the US, Europe and other parts of the world have also fallen to record levels. The investors should now hold back on selling and use this opportunity to invest in low priced stocks that may give them good return in coming months. Investors who are risk takers can buy stocks after proper study, said Saurabh Patwardhan, stock broker.

The fall is a result of continuous selling by domestic and foreign institutional investors. Many are persistently selling their holdings. The nervousness among the investors regarding the Russia-Ukraine war situation, rising global inflation and the omicron variant are contributing to the crash. Investors are pulling out of the market due to the rising volatility in the wake of a possible global economic slowdown in case of a war, said Vikas Kale, owner, Shri Ganesh Investors.